Bitcoin (BTC) has reentered its most significant lifelong consolidation zone, but new study warns that it could yet drop to a “macro bottom.”
On April 27, on-chain analytics platform Material Indicators highlighted the significance of $38,000 for BTC price action in a Twitter conversation.
BTC/USD has yet to make a decisive move up or down after hanging near liquidity at or above $37,700 on intraday timeframes, according to data from Cointelegraph Markets Pro and TradingView. Traders have been left guessing which direction the market will go.
As the impact of inflation and geopolitical instability is plainly felt on stock markets, macro forces require greater fall.
On the other hand, on-chain indications, headed by miners and their ever-increasing investment in hash rate, are anything but gloomy. Regardless of the date, $38,000 is a significant historical price for Bitcoin.
“Since the breakout from $20k in Dec '20, BTC has consolidated in this range more than any other,” Material Indicators noted. The “point of control” — essentially the price level with the most volume — is now “precisely” where spot pricing is now acting, according to the report.
Given this month's price trajectory, it's unclear where Bitcoin might go from here. Material Indicators noticed both bullish and bearish patterns repeating themselves this week after analyzing the 3-day chart.
Volatility is almost certain, regardless of direction, due to the nearing monthly close. BTC/USD is currently projected to conclude April $6,000 lower than where it began.
On last Sunday's close, the weekly chart produced the first four-period red candle since June 2020, as Cointelegraph previously reported. Meanwhile, two important weekly moving averages replicated a unique trend that triggered a 50% BTC price drop twice this week.
Finally, Material Indicators introduced whales into the equation. In addition to currently being below all three moving averages, whale buying and selling activity at this critical juncture is critical in deciding future trajectory.
“Until BTC reclaims the key moving averages these are considered distribution rallies used to sell the rip or add to short positions,” Material indicators added. Furthermore, they said that: “Expect more volatility coming into the Monthly close/open. Will look for a new Trend Precognition signal on the Monthly chart then.”
It has been evident that macropolitical and economic factors have been a key driving force when it comes to determining the price of BTC.
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